EFG Hermes issues LE 2B- bonds for Talaat Mostafa’s subsidiary

CAIRO – 8 April 2020: EFG Hermes obtained the approval of the Financial Regulatory Authority (FRA) regarding the first issuance of sukuk in the Egyptian market, with a total value of LE 2 billion.

The company clarified in a statement that the issuance is made through a deal of Ijara Sukuk that is compatible with the provisions of Islamic Sharia. They are negotiable, expedited and non-convertible into shares with a maturity of 5 years.

Ijara Sukuk are certificates of equal value issued by the owner of an existing property or asset, either on his own or through a financial intermediary, for the purpose of leasing it against a rental from the subscription proceeds.

Hermes pointed out that the issuance comes in favor of the Arab Company for Projects and Urban Development, the real estate development arm of Talaat Mostafa Holding Group.

It pointed out that the Sukuk has obtained a credit rating (A +) with a stable outlook from the Middle East Credit Rating and Investor Service Company (MERIS).

According to the statement, this issuance is considered the first deal to issue sukuk in the Egyptian market, as it is considered the largest deal of issuing and arranging debt in the Egyptian pound for the private sector in the history of the Egyptian financial markets.

EFG Hermes acted as the sole financial advisor, coordinator, sole promoter and underwriter of the deal. EFG Hermes also acted as the issuing company.

For his part, Co-chair of the promotion and underwriting sector, Mostafa Gad, stated that his company succeeded in the end of 2019 in the first issuance of LE 400 million of short bonds for Hermes Securities Brokerage Company, and also offered short-term securitization bonds for the first time in the history of the Egyptian market, in a LE 167-million issue for Premium International.

FRA approved on December the first program to offer short-term bonds in the amount of LE 2 billion to a securities brokerage firm, allowing it to finance its activities. This step came after it approved a program issuing short-term securitization bonds worth LE 2 billion in November 2019. As part of this program, FRA agreed to issue two short-term securitization bonds for Premium International for credit services.

CAIRO - 17 December 2019: The Financial Regulatory Authority approved the first program to offer short-term bonds in the amount of LE 2 billion to a securities brokerage firm, allowing it to finance its activities, Chairman of the authority Mohamed Omran said Tuesday.